Defragmenting diskdrives on servers running SQL Server 2000.

SQL Server is running with data and logs on Raid1+0 Disk Drive.Performance is poor. I have joins on tables with over 8million records taking over 10 hours. I analyzed the harddisk for fragmentation and I see file fragmentation 95%, Total Fragmentation 47%.
I have these findings/assumptions: Its not out of RAM because buffer hit cache ratio is 99+%. It is not utilizing lot of CPU because %Processor time is very low. there is no old statistics and internal fragmentation on indexes: because DBCC DBREINDEX builds the index and updates the statistics and I recently ran DBCC DBREINDEX with 90% fill factor.
Average Disk Queue length is over 25.Should I use disk defragmenter Windows 2003 tool to defragment the drive. What is long term and short term solution.
The first bullet point after 3rd paragraph also seems to lead me to that conclusion. Please advice. http://www.microsoft.com/technet/prodtechnol/sql/2000/maintain/ss2kidbp.mspx